The present invention relates to a computer based system for continuous settlements of competition for allocation of time-varying resources whose values change over time on a scale comparable with the period of settlements. CONDITIONAL PURCHASE OFFERS, Assignee: Walker Asset Management LP; U.S. Pat. No. 5,794,207 issued Aug. 11, 1998.
According to the invention, a method and apparatus for continuously settling multi-sided competition for allocation of multi-attribute time-variable resources whose value changes over time, or which expire if not allocated prior to a predetermined time comprises applying a time-dependent cost optimization function to current and subsequent settlement periods. The invention is applicable to diverse fields, such as allocating professionals"" time, competitive selling of perishable goods, allocating production capacity, and committing media space. The invention is useful in such fields as construction, information technology services, wholesale food, production of electronic circuit boards, and selling of television advertisements.
In the framework of this invention, resources are represented by offers to provide resources (called provider offers, PO), and requests for allocation of resources are represented by offers to acquire resources (acquire offers, AO). Providers and acquirers of resources initiate and submit POs and AOs, respectively.
The method includes mechanisms for efficient settlement of competition among AOs and POs that are presented over time. The mechanisms include (i) accumulation of arriving AOs and POs, (ii) running a series of settlements, also called arbitrations, where in each arbitration, multiple AOs and POs are considered concurrently and their matching and competitive constraints are analyzed. AOs are allocated POs whose matching deems most beneficial based on a predetermined utility function. Less competitive matchings of AOs and POs are not allocated. The mechanisms also include preemption of low priority allocations by high priority AOs that arrive subsequent to the settlement; roll over of AOs and POs that are not allocated to subsequent arbitrations; and a forward-looking assessment of the impact of current settlement allocations on future settlements to prevent allocation to inferior AOs from blocking resources for more lucrative future AOs. AOs and POs are allowed to change over time in order to improve their prospects of winning the competitive allocation and to adapt to time-dependent values of the prospective allocations.
In one embodiment, a central control system whose arbitrator subsystem executes the method, is connected by means of a communications network to providers and acquirers of resources. The providers and acquirers communicate to the arbitrator offerings to provide and acquire resources, POs and AOs, respectively. POs specify resource availability, characteristics of operation, and conditions under which the resources can be allocated. AOs specify the needs of their senders for particular services and the conditions under which allocation of resources is acceptable. The arbitrator stores received AOs and POs in a database and occasionally selects a subset of the AOs and POs, analyzes their compatibility, arbitrates their competition, and allocates resources to AOs.
Both AOs and POs are represented in the computer""s database by multiattribute objects. An AO targets the allocation of a subset of resources within a specified range of parameter values, for example a time interval. AOs identify at different degrees of precision a plurality of resources acquire, and place conditions on the allocation of the resources, like price range and range of time at which allocation is acceptable. An example is when an AO identifies the task to be performed by the allocated resources and not necessarily the specific identity of the resources that perform the task.
A series of settlements arbitrates the competition among AOs and POs, where in each settlement the arbitrator selects a subset of the AOs and POs in the database, and concurrently associates multiple POs and AOs by matching their attributes. In each settlement the arbitrator identifies for each AO multiple POs that match the AO""s attributes, making them candidates for allocation to that AO. Prior to the arbitration, acquirers and providers who submit AOs and POs, monitor their individual competitive positions, and modify one or more times their AOs and POs in order to adapt to time-varying value of the allocations and to improve their prospects of winning. At the beginning of the arbitration process, the arbitrator decides on the cost optimization function for allocation based on the competitive conditions, for example by considering whether the providers are competing or collaborating. The AOs and POs are selected for analysis based on this function. Also, the optimal allocation fairly arbitrates the competition among the AOs and the POs based on a cost optimization function. The output of a settlement is a list of allocations, i.e., AOs and the POs allocated to them, which the arbitrator communicates to the respective acquirers and providers. The list can include an exact match to the AOs, or a compilation of multiple alternatives.
Consecutive arbitration decisions are interdependent in that resources allocated in one settlement affect the POs and AOs that are available in subsequent arbitrations. AOs and POs arrive at the arbitrator at indeterminate times, so that when an arbitration is run, the prevailing conditions in subsequent arbitrations are not fully known. The method includes several provisions for optimizing the allocations over time. One provision is called look ahead, whereby the arbitrator ascertains the impact of the current allocation on subsequent ones. The arbitrator decides on an allocation in a specific settlement so as to minimize negative impact on future allocations. Another provision for optimizing resource allocation over time is called conditional acceptance, whereby the arbitrator allocates a resource to an AO first tentatively, and subject to subsequent preemption if future conditions yield more efficient allocation under such preemption. Another provision for optimizing resource allocation over time is called roll over, whereby the arbitrator retains AOs and POs that do not win allocation at a settlement, and considers them in subsequent settlements.